FAM and MP & Silva Deal : Are We Going the Right Direction?

So, over the weekend I was reading up on the news regarding the development of our local football scene and interestingly enough, a lot of people are buzzing on the topic on the proposed idea of "privatizing" the M-League with the emergence of a new media sponsor.

A quick update for those that do not know the story, in the recent days, the Football Association of Malaysia (FAM) have successfully brokered a deal with a London based media group, MP & Silva to set up a joint company, Football Malaysia Limited Liability Partnership (FMLLP), which will be the governing body to manage the M-League from 2015 onwards.

This would mean that the company will run the league as a profit based company, with agreed funds pumped into the league and the company amounting to an eye watering RM1.26 bil for the next 15 years! This would also mean that media broadcasting and advertising rights will also be managed by the formed company and reportedly redistributed to the participating teams.

News reports have stated that with this brokered deal, one would be looking at a financial contribution breakdown that FAM will be receiving of:

RM70mil per year to FMLLP from 2016-2021

RM85mil per year from 2022-2024

RM92mil from 2025-2027

RM103mil from 2028-2030.

Financial redistribution of each of year from this would be a 30% contribution from the yearly amount to each team and a 10% amount to be used for redevelopment of the youth system. The remainder 60% would be used as a running capital for the said company.

On paper, this would mean the local league would receive a HUGE monetary boost that we sorely need for the league.

But would this be for the best for the local football scene?

Malaysian football fans, who have long suffered with the 30 years slump that we have seen in the quality, performance and overall outlook of our local and national football, are understandably wary of changes such as this, especially when it involves large scale monetary boosts from a foreign organization.

Therefore a lot has question, would the privatization of the league be of much benefit for the redevelopment of our football? For us here in Teh Tarik Memoirs, we've highlighted a few possible issues that we as Malaysian football fans are skeptical.

Assurance on Redistribution of Wealth for Teams

One of the biggest issues here would be the redistribution of broadcasting funds and yearly contribution of FAM to the teams. Many have highlighted that in the past, local teams were suffering due to the lack of funds that they receive each year. Instances of funding not reaching the teams, which the results to players and staff not being paid (example can be seen with the Perlis National Team not being paid) and other financial issues faced by teams.

One would now question, is the scenario going to repeat itself, with even worse repercussions as it now deals with millions of Ringgit at stake?

Solution: If the company can guarantee transparency in the wealth redistribution of media and broadcasting rights (which contributes the most in the profit of football teams) according to the agreed upon breakdown, then this would be of great benefit for the development of the teams.

We would have to agree with what was mentioned by Tengku Mahkota Johor (TMJ) on the redistribution of the media and broadcasting profits, as this would be the biggest source of funds for the teams which they sorely need. Similarly to how it is done in the biggest leagues in the world, each year every team is to receive a set amount from the governing body according to their place in the league, it would then increase the competitiveness of the league and the development of players accordingly.

Fans to Pay for Privatization Costs?

Much like any other privatizations of any business, one would expect that with the league being run on a "profit based company", hikes are expected to happen for stadium ticket prices and in the end would dampen the interest of fans to come and watch a game.

Costings such as this and many other, all done in the name of increasing profit margins would seriously hurt the fan base and the league as the promotion of the league needs to make it affordable and accessible for the fans and their teams, which is something that many people are calling into question.

Solution: If such increase happen, it should come as an after result of improvements that can be seen in public. We believe that if the redevelopment of the league and promotions for the football matches are increased tremendously, fans don't mind paying for the extra costs as they themselves can see where the money is going into. Much like in the English Premier League, fans still flock the stadiums even after the increase due to the Arab takeover of clubs.

Mismanagement of FAM and its Downfall

In the last 30 years, we have seen abysmal decision making process happen within the ranks of FAM. From talent management, player selection, wealth redistribution, league management, rules and regulation and finally fan management, many find it hard to believe that these people are actually up there doing their job properly.

Question is, would this continue? Malaysian fans are sick and tired of listening to issues of corruption and extremely bad management decision making process for our teams, which then hurts the teams.

Solution: Much like any other private companies, if there were to run this league in a "business management sense" then theoretically we would be able to solve this problem. Quarterly reviews on the performance of teams and management staff of the company with a very strong KPI would determine a "check and balance" for the performance of the company. Ship out the deadweights and run the company with a tightly checked crew.

To achieve this, there should be VERY LITTLE INTERRUPTIONS from other external bodies in the management of the company, therefore the policy of running the company is not affected.

Can We Afford the Broadcasting Rights?

Finally, the biggest fear that people might have is companies such as Astro, RTM or TV3 would not be able to afford the broadcasting rights of the league.

At the moment, there is a need to highly boost the popularity of the local league through all forms of media and if there is no company in Malaysia that could afford the

"new rates of telecast" for the game, then we are once again screwed.

Are we expecting MP & Silva, on of the biggest media broadcasting agencies in the world, to bump up the prices of media broadcasting in Malaysia so high that no one would be able to afford it?

Solution: We believe that this all boils down the business strategy and policy making of the said company. They need to first understand the business concept of here in Asia and finally come up with a "win-win" deal that would promote the league through broadcasting in a bigger market and in the same time generate income for the company.

Bear in mind, we here in Teh Tarik Memoirs are a looking forward to this development with MP & Silva, as any changes for the improvement of the league is indeed welcomed. However, there is a need to address all possible solutions that might jeopardize the efforts of rebuilding the league entirely before implementing the business policies of the company.

For one, we would wish that this would open the door for the management of the league, regardless of who they are, to listen to what the fans have to say or expect from the improvements. Great ideas sometimes comes from all of us who stood with our local and national teams all these years and perhaps be more transparent with our opinions in the implementation of the league.